WPP profits up

Published on February 21, 1996.

London-based WPP Group reported a 33% increase in 1995 pre-tax profits of the agency holding company to $179.4 million. Revenues rose by 9% over the previous year to $2.45 billion on total turnover of $10.34 billion, also up 9% from 1994. WPP attributed part of its growth to net new billings of $1.7 billion in 1995 and improved operating margins of 12.1%, up from 10.4% in 1994. WPP's best-performing companies were New York-based J. Walter Thompson Co. and Ogilvy & Mather Worldwide, where revenues rose by a combined 11.5%. Geographically, Asia/Pacific, Latin America, Africa and the Middle East now account for 19% of WPP's revenue, compared to only 12% five years ago.

WPP also noted "continued signs of a shift in client spending from so-called below-the-line activities such as trade and consumer promotion to above-the-line media advertising. Some major advertising spenders are experimenting with dropping coupon activity, concentrating on everyday low pricing and beefing up network television spending."